Elias Gröndal: the European footwear industry will be very strong

Elias Gröndal is the founder and CEO of the online footwear sourcing platform FindSourcing, now Resourced. With more than 10 years of experience in the footwear field of sourcing, supplier management production planning and management he is now dedicated on how to provide an overview in the footwear industry by making it more transparent and approachable.

Elias worked in the H&M group, one of the biggest fashion retailers globally, for 8 years with organizational management, product development as well as footwear and material production. He was stationed in Shanghai for more than 3 years on their behalf where he was mainly responsible for men’s and kids shoes production in China, India, Vietnam and Bangladesh. He also headed the European production organization for footwear, bags and belts.

I think that for some stakeholders (sustainability) is more a concern to address because of market needs and in some other aspects there is a real inner motivation to do a strong difference. But the driver, at the moment, from my perspective, is that there are business reasons, and (companies) want to find ways to increase selling through sustainability.

It has been very clear that brands have benefitted in a certain way (when they were) based on a structure where they are more direct-to-consumer based, than older or traditional sales-channel-driven brands with physical retail stores. These have suffered more.

That has also manifested well in the way brands are developing these days, putting production closer to their heart or to their core, to where the consumers are.

It is also clear that many brands have developed a different strategy containing a strong risk assessment in terms of the sourcing environment, so they want to source from multiple locations to have a more diversified risk portfolio.

I think the European footwear industry will be very strong. I think we already see that shift and a lot of brands want to move there, because it is closer to the consumers, they can get a quicker response from the suppliers compared if they are buying from a more distant area. So, I think we are already seeing the increased importance of Europe as a production destination.

Adding the price and the cost into the equation, where the costs are on the rise, is going to create a more complex sourcing strategy for brands. Because now, it seems a very easy decision to move back production to Europe, as it is safe, it is more predictable. But with an increasing price situation I think it is going to be one of the main challenges.

The big challenge for the industry is sustainability. There are so many different components in a shoe. There are so many different locations from where these components are sourced that transparency is and will continue to be a challenge.

I think there will be a big challenge on pricing, as logistics costs are increasing, and the whole supply chain is getting more and more complex. I think that will become more visible for consumers and we need to think how we can open up, so it is also possible for consumers to get more insights on the process and not only on materials.

The challenge for the footwear industry is how we can create the transparency and relevance in opening up the processes, so it also makes sense for brands to invest in that.

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